May 5, 2011

Estonia to provide loan guarantees for pig fodder

The Estonian Rural Development Foundation (MES) is prepared to alleviate the effect of the rise in the price of fodder grain to pig breeders by giving guarantees to turnover loans intended for the production of pork.

This is because swine breeders in Estonia are facing a difficult situation due to exceptionally high grain prices, MES said.

It was found at the meeting that it is crucial to find liquid assets for the purchase grain. First, the cooperatives would have to carry out an audit about who needs the loan money and how much of it.

The Estonian Rural Development Foundation is prepared to give guarantees to turnover loans for the production or pork, while bringing the fees of the guarantees as low as possible. One of the solutions would be joint purchase of grain for members of their cooperative using the MES guarantees.

Martin Vilen, agricultural sphere specialist at the Estonian Chamber of Agriculture and Commerce, said that the difficulties were probably temporary. "The growth in the price of pork both in the EU and Russia in the recent weeks gives the hope that the problem will be alleviated and it will be possible to keep the Estonian pork production level," Vilen said.

The Estonian Chamber for Agriculture and Commerce said in April that in the Estonia pork farmers' assessment the price of fodder grain, which had risen by up to 150%, was bringing a loss of EUR500,000 (US$741,950) a month to the sector.